Docs/Protocol/Gap markets
Protocol
Gap markets
A position on one number: the official opening print. Long the gap or short it, the bell settles everyone.
6 min read
The instrument
A gap market is a cash-settled position on the difference between a stock's last official close and its next official open:
gap = (official_open / official_close) - 1
Long ("gap up") → profit if gap > 0
Short ("gap down") → profit if gap < 0Positions are margined in USDC with up to 10x exposure. PnL is linear in the gap: at 10x, a +1.2% opening gap pays +12% on margin to longs (and −12% to shorts).
Why the night price matters
While a gap market is open, the underlying Stock Token keeps trading on Robinhood Chain. That live night price is your best estimate of where the open will print, the market's consensus, updating in real time. The trade, in essence, is: is the night right, or is the night wrong?
- Earnings beat at 4:05 PM, token +3% but you think it's under-reacting? Long the gap.
- Weekend panic has the token −6% on thin liquidity and you expect a calmer open? Short the gap.
Market lifecycle
| Time (ET) | Event |
|---|---|
| 4:00 PM | Close print recorded via Chainlink → night session opens, positions can be opened or closed freely |
| 9:25 AM | Position opening freezes (5-minute pre-settlement window) |
| 9:30 AM | Official opening print delivered → all positions cash-settle |
You don't have to hold to settlement: positions are tokenized and can be closed against the live market at any point during the night.
Risk
- Leverage cuts both ways. A 10x short into a surprise +2% gap loses 20% of margin. Liquidation triggers at 80% margin loss based on the live night price.
- Halts & no-open days. If a stock doesn't print an open (halt, corporate action), the market extends to the next official print, per the settlement rules.
Status